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tv   Your Money  CNN  June 9, 2012 1:00pm-2:00pm EDT

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rate is higher than the national average. nevada and colorado the rate is above what it was when president obama stepped into the white house. rest of the battleground states it's interesting. the jobs marks are improving. they had been improving since when the president -- president went into office, still improving, iowa, new hampshire, low unemployment levels. 5% in iowa. new hampshire, 5%. virginia, 5.6%. in ohio, with 18 electoral votes, much more than iowa and virginia combined, you've seen a significant drop in the unemployment rate from 8.6% to 7.4% over the year. >> they went from 48th in the nation to higher than that. it's an interesting story, ohio, big auto manufacturing, big manufacturing base, and this is one of those places where mitt romney had said, don't have that auto bailout. my feeling is nobody wins without ohio, and mitt romney's going to have an uphill battle there. >> take a look at ohio, because this right here, this showing
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you the population centers of ohio. some the areas where the president did well last time. this is the polling we've got. most recent polling for the presidential race, obama with 48%, romney with 42%. even though the unemployment rate has been coming down there, you've got auto bailout issue which could be very, very critical, you still have president obama with a six-point lead over mitt romney. so, no question, no question, even though the unemployment rate is improving in ohio it's an important swing state for the president. >> thank you. we're joined by republican governor john kasich of ohio who is taking time between the presentation so he's come out in the hall and just to talk to us. governor, thanks for being with us. listen, i don't see how voters in ohio, many of whom are autoworkers, union members, manufacturing workers, alienated by governor romney's opposition to the auto bailout are going to hand your state to governor romney. without ohio, we know this, most
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people don't get to the white house. why am i wrong about this? >> well, i think ohio's going to be very close, there isn't any question about it. the fact is, ohio's grown now about 73,000 jobs, and we're really pleased with the growth with the auto industry. but it's been about a net of about 700 jobs grown out of 73,000. so i think what's happening in our state is people are somewhat more optimistic. our credit ratings are up. we have surpluses in our budget. jobs are being created. i think the issue's going to be who can make the best argument to help ohio to continue to be successful and get the wind at our back. and i think that's what americans are worried. i'm worried about we have the wind in our face because of uncertainty in our state brought to us from washington. >> i tell you, the "fortune" magazine article, which refers to you ace republican governor with an obama-like jobs plan, you believe that there's a role for government to play in creating jobs and overcoming
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headwinds. >> well, look, i mean, don't read too much into things that are written in other publications. let me just tell you this, we offer incentives to companies when it's appropriate. but that's not what gets companies into ohio. what really is the bottom line is we have created an atmosphere with lower taxes, balanced budgets, streamlined regulations and that's what businesses are looking for, looking to go somewhere where they can have confidence they can have certain certainty, and that's what happens in ohio, running surp s surplus surpluses, streamlining regulations, that's what's really helped us. at times it's necessary for us to offer some incentives, but every state in america does that. but that's not why we're the number one growing state in the midwest and number six in the country coming from 48. it's because we have followed a policy of making government work better, of lowering taxes, of balancing those budgets, and getting our credit upgraded so businesses feel more comfortable in ohio. >> what's your sense, though, on
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the manufacturing front, because it continues to be a big problem. what is -- what has to happen to bring these? high oil prices, wage controls, the kind of thing that happened in wisconsin? what has to happen? >> no, i mean -- first of all we've got to get certainty out of washington. you can't be turning around telling people you're going raise their taxes. we've got a huge amount of debt and it's created uncertainty in everything. but you know, look, we embrace manufacturing in ohio and not just auto manufacturing, though we love it we embrace the making of pipes and pumps for the energy industry, unmanned vehicles, the ability to build them. it's diversified. that's the key to it. we can use our location, we're within 600 miles of 60% of the country and we're a place where businesses can be safe. so all in costs, ohio's starting to win, starting to get some companies come from other countries. and in some companies come from other countries and invest in our state. >> you're not as troubled by unemployment numbers as some
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republicans would like everybody to be. >> oh, i'm very upset about the unemployment numbers because it means that people are out of work. look, our unemployment has come down. we have created the 73,000 jobs, whatever it is, but 73,000, like 300, but that's not good enough for us. we -- our unemployment is way too high. we need to continue to bring it down because when people areut of work it hurts families. so i'm extremely un haphappy wi where the unemployment is but we're making progress. we were the 48th job creating state in america and now we're number six. there's reason to feel good but not feel great because there's too many families out of work in our state and our country. >> governor i know you've got to run to another commitment. thanks for taking time to talk to us. governor john kasich, republican. >> glad to talk to you. god bless you. thank you. >> a big win for wisconsin governor scott walker in the state's recall vote. who was the biggest loser in
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how and why did governor scott walker win this recall that those protesters wanted? >> well, i really would like to say he survived the recall because, remember, this is a recall process. he's only the third governor no go through this humiliating process. and after spending over $50 million, after losing control of the senate, after having his favor ability ratings permanently lowered after having the worst job creation record in the whole united states, he's dead last, he gets to serve out the next couple of years of his term. he would have been better off trying to work with us and create jobs rather than destroy everything as he did. if you looked at governor kasich, who was on a little while ago with you, after he stopped making war on his employees, the state started to move ahead a little bit. i think that's what governor walker should now do, look at ways to work with us to create jobs rather than making war on his employees. >> sounds reasonable.
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let's bring in steven moore, editorial writer with the "wall street journal." you say that governor walker's victory is clearly a black eye for unions who were supposed to mobilize all of these voters to come out and see him defeated. what do you think about what richard said? should he move on and try to deal with them or do you think the unions need to -- >> this is a tough week for the unions. not only did they lose in wisconsin. by the way, richard is right the republicans spent a lot of money to tray to make sure that walker survived, but the unions spent a bunch of on money, too. don't leave out california, san diego, san jose voters voted for cutting back on some of the pensions because the pension issue, it's one of the biggest issues in the country in terms of finances of state and local government. it's a tough week for unions and i'd say to richard trumka, when you shoot at the king you better kill him. the reason this is a bad week
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now scott walker has survived and a lot of other governors around the country are saying you can take on the public employee unions and you can live to tell about it. >> it's amazing, when we beat john kasich in ohio with 62% of the public vote nobody said that was the end of the republican party. what we said at that time is, now john kasich, after we beat him, john kasich ought to come together and work with us to kro create jobs. we sent politicians to go into office to create jobs. scott walker actually deceived the american public in wisconsin when he first said that this attack on workers was about an economic reform because it wasn't. those workers, when they saw real problem, every single time have been willing to pitch in, to give something back when it's a real problem. when it isn't a real problem, we will fight to have fair treatment, just like every other american. that's the american way. and that's what we look forward to. >> can i say something about
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that? i think it's important. i want to address this to you, richard. i don't think this is just about unions. i think it's about public sector unions. the public sector union where the growth is they're getting benefits and getting retirement and health care that's much higher than private sector unions and get and ordinary americans get. i think one of the reasons scott walker survived is it was an issue of fairness. why should public employee unions getting outsized benefits higher than a plumber or someone else living next door to them also in the middle class? >> to be clear here -- i want to bring viewers up to speed on that -- unionization is -- there are more -- higher percentage of public sector workers are unionized than private sector workers. take it away, richard. >> i think stephen's wrong about the numbers. public sector workers don't get more. study after study they get a fair shake i can't believe it --
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of course he's from the "wall street journal" did i can't believe when a ceo hits 380 times more than somebody that -- than the average worker, stephen's paper and himself cheer that and say that's economic, that's great capital itch, that's fair. it isn't fair. they make too much. he doesn't say a word about that. >> what do you say about that? what do you say about that? >> no, let me finish for a second, ali, because what he said is un-american. we would look at somebody who doesn't have a pension and we would say, what do we have to do to get them a pension? stephen wants to stand america on its head and say, look they have a pension, let's take that pension away from them. he doesn't say that about ceos only workers. >> stephen? >> you're putting words if my mouth. i think workers should have a pension. i think it's part of a fair pay package. the problem is, let me take illinois my home state, which has a pension crisis as well. >> talk about wisconsin u.s. >> let's talk about illinois for
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a minute. in illinois you've got teachers retiring at age of 55, with 100,000 a year pensions. that's happening in america, it's not affordable and taxpayers are saying we can't afford to give somebody 20, 30 years with pensions benefits that are sometimes twice as high as what the private sector worker is receiving. >> stephen, here what happens i say to you. if there's a legitimate problem we're willing to work to solve the problem. but everybody should solve the problem. you shouldn't be able to have 1% continue to haul away more money than a dump truck can haul away and say to working people to sacrifice for less 0 they can have more. >> the fact is there are many people in america who think it's not a fair deal. so you have said, steven, that you think unions contaminate everything they touch, maybe you're right, maybe you're wrong, but what do you do for people who think they're not getting a fair shake? and richard's words the 1% are loading it on to a dump truck
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and running away from. lot of americans think of it. >> i want a rising economy that helps all workers. to say take away from the top 1% i don't think that's going to help the average american worker. when it comes to the issue of unions, think of the imagine unionized institutions, steel companies, auto companies, postal service, these are institutions going bankrupt. you have to ask the question, are unions necessary? and the private sector, as you know, only about 6% or 7% of workers are in unions. all of the growth of unions is in government. >> richard? >> here what happens i know. whenever we had collective bargain is the cornerstone of a balanced economy. when we had 35%, 40% of the american workers in collective bargaining the level of inequality in the country was going down, level of wages for everyone was rising. as collective bargaining went
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down inequality went up. you asked a u.s. steel worker to compete with a million that was made in 1890 with a mill made in 1980. that was part of the world that they were competing in. they were the most productive, the american worker is the most productive, and when we work together with our employers, nobody can beat us. >> all right. >> you ought to be advocating workers and management getting together not making wore on them. >> we need more capital investment for the country so we're creating jobs in the u.s. >> with the guy from the "wall street journal" and the guy from the afl-cio agreeing think would be an excellent place to end the discussion. a pleasure to have you here. richard trumka is the president of the afl-cio. we'll have you back soon. steven, stay there. president obama calls it the do nothing congress. harry reid agrees. >> we can no longer go through
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this every bill. filibusters on bills that they agree with, it's just a waste of time to prevent us from getting things done. >> why can't congress get anything done? anyone who says blame the republicans is going to have to answer to steven moore, next on "your money." new e-trade 360 dashboard you see exactly where your money is and what it's doing live. our e-trade pro platform offers powerful functionality that's still so usable you'll actually use it. and our mobile apps are the ultimate in wherever whenever investing. no matter what kind of investor you are, you'll find the technology to help you become a better one at e-trade. [ woman on r♪ bum-bum,stinct ] bum-bum, bum-bum ♪ ♪ bum-bum - ♪ ai, ai, ai - ♪ bum-bum - ♪ bum-bum, bum-bum - ♪ [ ice rattles rhythmically ] ♪ bum-bum, bum-bum, bum-bum ♪ ♪ [ imitates guitar noise ] ♪ [ vocalizing up-tempo heavy metal song ]
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try capzasin-hp. it penetrates deep to block pain signals for hours of relief. capzasin-hp. take the pain out of arthritis. . you find yourself asking, what happened to moderates in the united states? where have they all gone? the american public is more polarized than at any point in the last 25 year. that is according to a new research -- a new survey by the few research center, americans are more divided along political lines than they are by race, religion or gender. no surprise then that a fiercely guided electorate has elected a congress that seems to pride itself on making no attempts at bipartisan solutions. a resident scholar at the
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conservative american enterprise. he describes himself as a centrist, his book entitled "it's even worse than it looks, how the american constitutional system collide with the new politics of extremism." stephen moore is back with us as well. he call himself a conservative. it takes two sides to compromise. you say congressional republicans deserve the blame in the highly partisan environment, why? >> that's right, ali. i have to say it's not 100% in that direction, but at this point, it's 80/20. if you look at the response of the last three years, we've had basically a congressional party, a republican party, that's operated as a parliamentary minority uniting against everything including ideas they have supported in the past because they're now promoted by the other side. that's different from what we've seen before. it's different from the way democrats reacted when george bush became president and it's ma as it ta sizing out as the
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survey shows to the country. >> trying to get to the bottom of why. watch this exchange between speaker of the house john bayne somewhere leslie stahl on "60 minutes" taped after 2010 mid term election when voters elected a wave of tea party candidates. >> i'm not going to come compromise on my principles nor am i going compromise the will of the american people. >> you're saying i want common ground but i'm not going to goes my. i don't understand that. >> when you say the word compromise, a lot of americans look up and go, oh, oh, they're going to sell me out. so finding common ground, i think, makes more sense. >> you're afraid of the word. >> i reject the word. >> wow, you were with me last week when we spoke to the president of the university of pennsylvania and wrote a book spert of compromise. you as a conservative can't -- it doesn't go hand in hand because you're conservative you don't want to compromise.
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what is boehner saying that? >> first of all, look, with all due respect i reject norm's thesis, look it takes two to tango if you have compromise both sides have to compromise. on the issues he's talked about, the big ones, the stimulus plan, there was nothing in there, norm, as you know that republicans would want. obama dropped if in their lap -- >> 40% was tax cuts. >> but those were not tax cuts that republicans want. >> one came from chuck grassley. >> the other one was obama care, and the seam thing. those were the same issue. barack obama passed through the house and senate without one republican vote and you're saying it the republicans that are being partisan. i think there's room, ali, in washington for common ground. i think they can get together on fixing this entitlement crisis that everyone knows happened, whether a liberal, conservative, everybody knows we have to do something about medicare, medicaid, social security. i think we can get together and get a deal between republicans and democrats on fixing the tax
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code so it's -- >> everybody talks about it. norm, last week when we had amy gutman on she referred to the simpson bowls commission, americans looking for compromise on tackling america's debt and deficit and took hope in the commission and that faded away, when president obama refused to back his own commission's recommendations. other presidents have faced opposition from congress before. how much of this republican, democratic not getting together, not doing the tango thing, how much of it need to be reflected on the president? >> well, i think the president made a big mistake in not endorsing simpson-bowles in the state of the union a year and a half ago. allen simpson himself, last week, said that he understands in a way what the president did because, as he said if he supported it they would and opposed it. when the president said, very positive things about the gang of six plan in the senate, and this shows it's not about conservatism, those is tomorrow coburp, saxby chambliss, mike
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crapo, card-carrying conservatives supported a plan that included revenues, when he said that a top aide to the republican lead in the senate wrote to politico and said, well that kills it, if he's for it we're against it. the health care plan was the republican alternative to the clinton plan in 1993. and endorsed by orrin hatch and chuck grassley. they spent seven months while the administration stood by work on a compromise in the senate and grassley said leaders have told me i can't compromise unless 70% of republicans in the senate are for it. the notion that obama was not willing to compromise is nonsense. >> we can agree there has not been enough compromise, there has not been enough of the stuff. stephen moore, it may take two to tango. why can't republicans step up and say, we need to change this country, this isn't working the way it's working. you elect us, we're all about compromise. that's not the message they're giving. >> divisions between the country should go, that's why this is a
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an important election. the health care bill, 30 more million people put on medicaid. explain this to me, how is it that if it's republicans are the problem for gridlock in washington, there have been 40 bills passed through the house which is controlled by the republicans and you know where they are now? >> they're not the big stuff. >> they're in the graveyard of the united states senate. they can't get through. >> we'll agree. the big stuff's not happening here. that's -- and that's the big earn. more is getting done in the senate than in the house new york question. >> no, more is getting done in the house. >> but more compromise on big things happening in the senate. >> but they can't pass anything out. >> the country needs big things done. we don't have a republican platform that says, we'll bring that compromise in. in other words, i think norm's right on that, i think amy gutman's right on that it's not fashionable to run on a basis of a platform that says i'll compromise. >> barack obama has been extremely polarizing and the
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republicans i agree with norm, the republicans are more conservative than they have been on any time in 25 years, but it's also true, norm, the dps are more liberal than they have been in 25 years. >> we'll leave it at that. norm we'll bring you back for the rest of the conversation. more of it to happen. a resident scholar at american enterpri enterprise, "it's even work than it looks." stephen moore is an editorial writer with the "wall street journal." thank you, gentlemen. what is equal and what is fair? what is pornography? a nobel prize winning economist here to explain into the fear, the terror, what is happening to your money now? you've been following markets? we'll show you how exactly to take advantage of what's going on while other people are running scared. [ male announcer ] if you think any battery will do...
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taxes, debt, jobs, health care, almost impossible to talk about any of those issues without hearing about fairness and economic growth. something nobel prize winning economist joseph stigla has been talking about for years "the price of inequality, how today's divided society and tankers our future" i sat down with him and will cain, a conservative, and insists that inequality isn't the dirty word most americans think it is. >> does the existence of economic inequality cause economic problems? is it in and of itself a self-interest problem for the 1%? what would you say to a critic like me, with all due respect you're focusing on the last 30 years alone. when you look at breadth of human history, inequality and capitalism walked hand in hand.
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almost with a total ig feg ignoo relative wealth. were you threatened the system of absolute wealth? >> let me make it clear, i'm not arguing there should be no inequalities. i'm not arguing that we want to completely equal society. what i'm arguing is, my real concern is what's happened in the last 30 years. last 30 years, our inequalities have gotten out of bounds. the fraction of the income, the share that goes to the upper 1%, has doubled. the fraction that's gone to the upper one-tenth of 1% has tripled. those eremes offen equality -- >> is what right ratio, professor. >> there's no precise ratio but you can tell, the debate, what is pornography, hard to write a definition. >> i don't want you defining that for me, i trust you. >> let me bring in an example from the book which may help us
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focus this. you talk about mitt romney, and you used him as an example, but of the wealth that he gains, rent wealth in most cases, he can't spend nearly the proportion of thewell he gains even for his various homes and his lifestyle. and what you're saying is somehow that degree of inequality deprives those who do spend a larger proportion of their income from spending it and creating greater economic growth. >> the way i put it is, is we know the following, those at the top save a lot. >> got it. >> those at the bottom, can't. they're living -- >> those at the bottom stimulate our economy more? is that the -- >> those at the bottom are spending money, consumption, part of the engine of economic growth. now, what happens is that when you take money from the bottom and you transfer it to the top through predator lending, the growth in inequality, however it originates what that does is
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weaken the total demand. >> right. >> now that's where there are alternative outcomes, alternative ways of dealing with this problem, one that has often been taken and one that the u.s. took the fed said, okay we need to stimulate the economy, how are they going to do it? they created a bubble. they had a lapse in regulations, low interest rates, that created a bubble, and it workedor a while. but that's the point, it only worked for a while. so it created this bubble. the economy seemed to be doing well but of course when the bubble broke, it left the legacy of debt, a legacy of excess capacity in real estate, something that we are going to take a very long time to recover from. and that's the kind of example of the mechanism by which inequality leads to weaker economic performance. >> can you buy that concept, though, that -- i don't know
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what the number is, what the right amount of equality or inequality is in terms of money -- at some point people people don't use as much of their money that generates economic activity. >> if if were simple as resource allocation, what's gone wrong with education? education is a large source of whatever inequal we have. we have thrown money to education, to no advance. >> many people will say, why don't we take this problem that you've identified with too much money in the top 1%, the top 1% of 1%, and make it easy for them to invest that money through tax cuts or incentives? >> the real problem is the reason they're not investing is nobody will buy their products. you don't go and invest unless you can sell. if you have more, better foundation, the private sector can build on that foundation. the problem is that we have been underinvesting in that foundation. so we've gotten out of balance. now, why is that happening? one of the reasons it's happened
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the interaction between economic inequality and political inequality. you know, we're supposed to have a government that reflects one person, one vote. but if you look at the actual outcomes of our political process it's better described as one dollar, one vote, or closer to that. >> great conversation. thank you. >> is my nobel prize on the way? >> will, thank you for joining us. i'm waiting for my nobel prize as well. professor will be back to talk about why we here in the united states should be worried about the economic problems in europe. coming up next, if you're terrified of the the stock market, don't run. what steps to protect your money. what it like to be an i 210 ton drilling machine. what it takes to build a subway. for three hours a week, i'm a coach.
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you are forgiven if you've been hiding from the markets lately. look at it, fear, uncertainty, bargains. stock prices, take a look from the beginning of the year, some say it's low, some people say it's cheap. but before you buy stocks you want to make sure your financial house is in order.
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the co-host of "million dollar neighborhood" on the oprah winfrey network. good to see you. >> great to see you. >> nothing panics you? >> nothing. >> so i want to tell our viewers why they shouldn't panic. first of all, how do my viewers know -- my rough guess is half of you invest in stocks, probably a lot of them are in 401(k)s or i.r.a. or maybe pension fund, in other words, not directly investing, and some low double digit percentage of viewers have a trading account and buy and sell things. >> yeah. >> should you or should you not, an economy where your wages are stagnant, house is stag nan, could be the only way to get rich. >> yeah. no, no, no, no. buy a lottery ticket instead, there's your answer. for mohammed jamjoon most people they shouldn't be in individual stocks. why? they're going to lose. it's like showing up at the big spender table in vegas, having not spent years playing poker in the basement with your buddies it's a tough game. if you've got 5% of your
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portfolio, roll the dice, have a great time, you have an employer in which stock is part of your comp or working with a professional with a track record, okay. for most people they shouldn't be playing the individual stocks. >> 5% is a magic number. divide your investments in chuvgs of 5% you've got 20% of something generally and no one turn is guying to affect you. if you bought facebook and it didn't do well, it was 5% of your. er portfolio. >> it was fun. you had skin in the game. >> but you don't believe people shouldn't be invested. you don't believe people should be buying individual stocks. >> low fee mutual funds, they should be in the market not in a way they can get a brutal haircut, unlike yours, fantastic. >> my haircut. >> you can get a brutal haircut on stocks that doesn't look as fantastic. >> there are places you should invest first. your 401(k) or errai.r.a., some
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match that. >> you sit there in the hr meeting, i think i hear music, no one pays attention. >> right, right. >> the company match can make a significant difference in the whole game. here's something you should invest in before that stuff. paying off credit card date. >> you're not going to get 15%, 19% in the stock market. >> you're not. pay that off. you tonight don't have to pay that interest guaranteed return. >> something you've written in a book, if you're investing because somebody tells you to invest for retirement, there's no passion for that. if you picture what that money is for, you tell me -- >> if you picture what your money is for, people talk about retirement, what are you doing? are you traveling, golfing, hanging out with your grandkids? what are you doing? >> because retirement is actually not an activity. it's a life stage. what's the activity that has you jazzed about it and motivated? so you do the right things. the first step of all of this, which people are also oblivious to is earning more than you
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spend which sounds boring as mom and apple pie, but if i talk to viewers directly in their kitchens i would see a significant percentage who did not have that actually on track. earning more than you spend. >> this what is you do. this show, million dollar neighborhood, give me the 30-second version. >> 100 families in a town, we work with them for ten weeks to increase collective net worth by 1 million. and it was astounding, first to see the community come together for this challenge. but also the places they saw hidden money, money they didn't know they had. some made huge changes, some made small changes. by the progress in getting a handle on their money was spectacular. >> bruce is more fun than he comes across by tell you not to spend money you don't have to not have credit bills and that stuff. a pleasure. the co-host of the oprah winfrey network's "million dollar neighborhood." joseph stiglitz is back.
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pay attention. what happens in europe is going to hit you no matter where you live here in the united states. it's very important to understand
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how math and science kind of makes the world work. in high school, i had a physics teacher by the name of mr. davies. he made physics more than theoretical, he made it real for me. we built a guitar, we did things with electronics and mother boards. that's where the interest in engineering came from. so now, as an engineer, i have a career that speaks to that passion.
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thank you, mr. davies. oh! [ baby crying ] ♪ what started as a whisper ♪ every day, millions of people choose to do the right thing. ♪ slowly turned to a scream ♪ there's an insurance company that does that, too. liberty mutual insurance. responsibility. what's your policy? ♪ amen, omen
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by now we know that europe's crisis is america's problem. >> because matters to us because europe is our largest economic trading partner. if there's less demand for our products in places like paris or madrid, it could mean less businesses or less business for manufacturers in places like pittsburgh or milwaukee. >> president talking to america on friday about the concerns that european crisis will slow things down in america. comes down to the viability of the euro, comparing the euro to the dollar is like comparing apples to oranges. the united states has a currency that binds more than 310 million people together. not so in europe. while the european union is made up of 27 states, not all of them use the euro, only 17, the ones in red, are in the eurozone.
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since the 19th century, use of the dollar in the united states has grown organically alongside america, the rest of america's economic growth and it's grown into the world's biggest economy, the world's most important currency and we had time to address hiccups in the currency overtime. by comparison, the euro's been around since 1999. 13 years. in the united states, federal and state financial institutions work in tandem. we have one commercial banks system. one central bank with the power to print money. one federal government that collects taxes and redistributes them according to need in effect subsidizing some states. in the united states, similar labor rules across 50 states with the same length of workweek, roughly the same benefits and the same retirement age. europe on the other hand is all over the place. france, mandates a 35-hour
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workweek. germans work more. many arg gue the greeks don't wk that much. and germany cringes at subsidizing greece, even if necessary. the eu countries would need to behave more like american states do. surrender some or all sovereignty to a more sen trae centralized union. dragging its heels has consequences here in the united states, to break down exactly what's at stake, back to my conversation with nobel prize winning economist joseph stiglitz. >> there is a great deal of worry that the events in europe be going to create a much larger group of poor people of recent equality. in spain, one out of two people are unemployed. average unemployment rate now, 23%. we're approaching in spain something that's akin to what we
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experienced in the united states, the great depression. >> yeah. >> so they are, because of their wrong economic policies, particularly austerity and the lack of the rest of europe to come to their assistance they are creating a problem. >> you made clear in your book, no major economy in which us atator hey work austerity has w? >> that's correct. something else steps in. mostly, exports. if you cut back on the government spending but exports fill the gap, then you can keep the economy growing. >> the reason that doesn't work in greece is because they don't is the ability to cut their currency low enough to make exports particularly attractive? >> exactly. and one other factor. their trading partners are also being weak. >> right. >> when your neighbors are going into recession and right now a large part of the world is very
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weak, it's very hard to support your way to prosperity. >> should we be looking at europe with real fear what it sdl to the global economy? >> yes. we are one connected system. europe is affecting asia. asia and europe slowdown effects us. it affects us through two channels. one, less able to export. a couple years ago, president obama trying to see where we're going to recover said, we ought to do it through exports. but if everybody else is slowing down, it's going to be very difficult for us to export our way to growth. the second part of the problem is, financial sector. our financial sectors are very interlinked. we saw that in the lehman brother crisis. there's going to be a lot of financial turmoil, whether you fixed problems or not, there are
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fixed problems or not, there are i think newspaper newspaper -- but they can also hold you back. unless you ask, what's next? [ zapping ] [ clang ] this is the next level of performance. the next level of innovation. the next rx. the all-new f sport. this is the pursuit of perfection. riding the dog like it's a small horse is frowned upon in this establishment! luckily though, ya know, i conceal this bad boy underneath my blanket just so i can get on e-trade. check my investment portfolio, research stocks... wait, why are you taking... oh, i see...solitary.
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projects in history. i'm talking about new york's new second avenue subway line. a massive project putting thousands of engineers, urban miners and construction workers to work, as well as some massive pieces of machinery. ♪ >> tell me the process. how does it start? >> drill the holes and put the
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kwimt equipment inside. >> we did that blasted all the way down to 80, 85 feet. and three football fields. he lowered in place a tunnel boring machine. this is one of the monsters that has at the head of it, and weighs about 210 tons. right? and it's being operated with a trailer gear that is somewhere between 850 linear feet. that machine starts actually excavating and boring through. it will go from one end to the other. when we are done, we pull the machine back. right? and we start the second tunnel by moving it over, and then we support it with rings. so it will actually be there. >> rings? >> metal rings. yes. big metal rings. you have to wait for the tunnel's end.
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then after you do the cacaverns >> what do they not know about this? >> it's the toll. you've seen this equipment. we have drum drills to drill holes in the rock. and take away the material and man lifts to get up and rejump the heights. >> all those that you see, those are drill holes. this afternoon we will take those stakes out, load them with explosives and shoot it. so all of this has been excavated by drilling and blasting. when we open up an opening this large, we are going to have to support the rock. machine ichts laying shot inii. >> providing a transportation link that will allow people to move, that will serve as the economy in the city. >> thank you for joining us the conversation this week on "your
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money." we're here every saturday 1:00 p.m. eastern and sunday at 3:00 p.m. eastern. stay connected 24/7 on twitter. my handle, @ali velshi, the show handle, @cnnmoney. have a great weekend. you're in the "cnn newsroom." i'm fredricka whitfield. all eyes on spain right now. the country is facing a deep banking crisis, and they are formally asking the european union for a bailout on international monetary fund report friday said spain will need at least $50 billion to get its footing back. in madridfollows development. what is spain asking for and what is it getting? >> reporter: hi, fredricka. i am just outside the press conference. had just been in the press conference. the finance, commerce moniinist said spain is a


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